This article falls in the category of interesting news note. It talks about a new gold backed digital currency. This is not a recommendation for or against this idea, just another example of how new technology is being used in the money and currency arena. Below are a few quotes from the article and then some added comments.
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"A new digital currency backed by gold is billing itself as a more compliant, liquid and ultimately reliable store of value than decentralized systems such as bitcoin.
CMO Inc., doing business as COEPTIS, has been beta testing its digital currency platform for two months and over the next two weeks will be expanding its membership to the invitation-only platform.
COEPTIS issues its own digital currency, calling it Global Standard Gold (AUG), which is backed by physical gold and held in a trust account. The digital currency is issued after a licensed financial institution, acting similarly to a primary dealer, acquires the gold on the open market and deposits it in the trust. The institution then notifies COEPTIS, which issues the proprietary currency.
The currency is meant to bridge the gap between physical and digital currencies. Because it is backed by gold and held in a trust, in theory it can be liquidated at market value at any time."
. . . .
"Many cyptocurrencies such as bitcoin use a decentralized system, but COEPTIS uses a centralized one. While a decentralized currency avoids the potential for a single point of failure, Cunningham claims a centralized one makes it more efficient and cheaper to operate.
"We have looked at the cost of running the blockchain in terms of how much money is invested" and "we are at orders of magnitude less expensive" if COEPTIS eventually achieves the scale of bitcoin, Cunningham said."
"Cunningham added that using a centralized system allows for greater protections against money laundering because it is "very easy to monitor…unlike a cryptocurrency where you can leave a well regulated exchange and enter into the netherworld," Cunningham said."
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My added comments: Please note that the people who own this system rejected the blockchain technology as too expensive. They also mention the problem with complying with money laundering regulations. These are issues that have been noted here on the blog. A two part article on all this was written by an expert on this subject and published earlier this year here on the blog.
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